Imagine you’ve been one of the biggest companies to come along in decades…
One of the few TRULY successful companies of the digital age that not only created an almost entirely new market – but then went on to make that market one of the most sought after entertainment mediums the world has ever known.
Imagine dominating your sector and making BILLIONS…
And then all of a sudden, at the snap of a finger, you’re fighting for your life.
That is what it’s like to be Netflix (NFLX) right now…
It’s being bombarded on all sides by companies that are copying its business model and technology, while doing its best to stay on top, and keep both users and shareholders happy.
It’s not an enviable position, to say the least.
And just when you think Netflix is about to go down – it begins to show new signs of life.
So, what’s going on?
Well, besides the obvious big-time players like Disney (DIS) and others getting into the video streaming business…
Netflix hasn’t really put out anything that has generated a lot of buzz lately.
That being the case…
The stock has been on a steady decline since it peaked over the past year in July.
Over the course of 11 days – NFLX dropped from a high of $381 all the way down to $307 – which represents an almost 25% drop in share price.
That’s nothing to shake a stick at…
And it didn’t stop dropping until mid-September when the shares bottomed out around $254 – for those keeping score at home – that’s a drop by over 1/3 in a little over two months.
The fact that Disney, CBS (CBS), and others were planning on coming online with their own streaming content was enough to shake the faith of Netflix investors – and the sell-off wasn’t fun to watch.
However, Netflix has rebounded as of late…
With its price flirting with $300 once again.
But why?
Well, one of the big announcements from the company has been its strategic partnership with Nickelodeon – the wildly popular children’s network – which will help with the HUGE number of users that could have switched to Disney’s new platform exclusively….
But that’s not the only thing that’s been happening.
One of the biggest developments with NFLX is…
Somebody has been snatching up shares at an impressive rate.
Now…
This hasn’t been advertised – it took a sleuth analyst at Gordon Haskett, the company head of event-driven research, Don Bilson, to figure out who exactly was doing all the buying.
Bilson said that Nomura Holdings (NMR) has picked up about 1.89 million shares of Netflix during the third quarter and may have done it on behalf of an activist investor.
Why should be trust what this man has to say?
Well, Bilson was the same sleuth who figured out that Nomura helped Carl Icahn get into HP through a simple options trade.
According to FactSet, Nomura holds about 0.44% of Netflix’s shares, which totals about 4.3% of the company’s total portfolio.
Bilson said he doesn’t know exactly who might be buying Netflix…
But he has two top suspects, the first of which is Bill Ackman of Pershing Square Capital, who mentioned recently he is building a new position in the company.
And Ichan being the second.
These are surprising developments…
But now it all makes sense as to why the stock has begun to rebound and why it may be a good idea to load up on shares while the rest of the world is sitting around twiddling its thumbs.
Netflix isn’t dead…
It’s just finding new ways to make money – and likely one of the biggest players in the world sees that and is going in BIG.
Of course…
You can choose not to do anything.
That’s your prerogative – as maybe a company like Netflix is too rich for your blood.
That being the case…
GorillaTrades could help you find some stocks that are more your speed. Our proprietary system scans the market each and every night to find the stocks that are exhibiting the right kind of technical strength and could soon explode in price.
You should consider giving us a try.
However, no matter what you choose – you may want to give Netflix a look…
It could make your 2020 a profitable year!
“It’s a wise man who understands that every day is a new beginning, because boy, how many mistakes do you make in a day? I don’t know about you, but I make plenty. You can’t turn the clock back, so you have to look ahead.” – Mel Gibson
